The study investigates
the relationship between trade and institutions across regions using panel data
for seven regions for the period 1980 to 2010 (31 years) and general method of moment
estimation method (GMM). Consistent with past literature, institutions were found
to have a significant effect on trade. Different measures that capture institutions
were used, domestic and international institutions were found to be significantly
promoting exports across regions and it was concluded that institutions mattered
reasonably in the trade promotion discussion. Domestic institutions were protectionist
in nature since they increased tariffs on imported goods, while international institutions
were probably reducing regional tariffs.